It may be a cliché, but management guru Peter Drucker’s famous quote “What gets measured, gets managed” is even more relevant now in 2020 than it was when it was first published in his 1954 book The Practice of Management. McKinsey’s DataMatics study backs this up, and shows that firms in the top quartile of analytics performance were 20 times better at attracting new customers than firms in the bottom quartile.
So the value of measuring and managing performance is clear, but how does this work in practice? Here we take you through the main steps of setting up marketing performance management for success.
STEP 1: Align your marketing strategy and goals with your overall business goals
In order bring real commercial value with your marketing activities, it’s important that your marketing strategy and goals tie in to the fundamental goals of your business, notably generating revenue, profit and a good ROI.
By identifying how your marketing strategy contributes to those goals, you are not only reinforcing the importance of marketing in the organisational structure, but also adding a level of accountability that can transform how your team sees their role.
Eliminating activities that are not aligned with one or more of your corporate goals will also help you focus on the most important activities that will bring the biggest impact.
STEP 2: Review the marketing processes needed to achieve your strategic goals
Once you have distilled your marketing strategy into goals and objectives that the whole team understands, it’s time to turn those into a concrete marketing plan.
Establish quarterly objectives, and break these down into monthly goals, each with KPIs that will help you track your progress. Identify the deliverables needed to meet your goals, and who is responsible for performing the tasks required. Developing accountability and ensuring that you have full buy-in from your team are hugely important to the successful execution of your plan.
STEP 3: Set up performance monitoring and performance management
Use a marketing dashboard to keep track of the real-time metrics and KPIs you have identified. This will ensure you always know where the team stands on the KPIs you have defined as most important to meeting your overall goals. It’s important that your dashboard is easy to use and update, can integrate data from a range of different sources and reports, and is scalable to accommodate the growth of your team, projects and overall business.
Reviewing the dashboard regularly, e.g. in a weekly team meeting, will give you the opportunity to celebrate successes and identify areas that need attention.
In parallel, set up a balanced scorecard for marketing to keep track of your progress towards your quarterly goals.
STEP 4: Define how the data insights will be used
Gathering and analysis the right data is only part of the challenge. Using it to inform future strategic and tactical decisions about the marketing mix is where your marketing performance management model will bring real value.
For this to happen, decision-makers need to be able to quickly and easily interpret the data insights. So focusing on their needs, and involving them in discussions about how and when they want to receive reports is key to making sure the whole process can drive lasting, sustainable change.
With the right marketing performance management in place, the whole can be much greater than the sum of its parts. Team members understand the role they play and other parts of the company start to appreciate the value that marketing really brings. And by monitoring and measuring performance in a way that is aligned with your overall company goals, key decision-makers will have the data they need to steer your marketing efforts toward bottom-line results.
For more about marketing performance management, take a look at our marketing performance management guide.